HB1180.DOC

SECTION 1. The purpose of this Act is to help procurement officers, before awarding a contract, identify contractors that habitually perform poorly. This will help to ensure that the public receives a completed project that is delivered on time, on budget, and of acceptable quality.

SECTION 2. Chapter 103D, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§103D- Inadequate performance database; contractors. (a) The administrator of the state procurement office shall develop and administer a searchable electronic database to record instances of inadequate performance by contractors for public works contracts under chapter 103 and construction procurement contracts under this chapter.

(b) The administrator of the state procurement office shall establish criteria for the listing of contractors in the inadequate performance database, which shall include the name and other relevant information of contractors on projects that:

(1) As a result of the contractor:

(A) Were over budget;

(B) Were not completed as scheduled; or

(2) Involved any other criteria of inadequate performance of the contract, as determined by the administrator of the state procurement office.

(c) The inadequate performance database shall be accessible to all procurement officers listed in section 103D‑203. The administrator of the state procurement office may make the inadequate performance database accessible to the public.

(d) At the completion of any construction contract under this chapter, the procurement officer shall review the project to determine if the project met any of the criteria in subsection (b). If the procurement officer determines that any of the criteria in subsection (b) have been met, the procurement officer shall audit the contractor's performance of the contract. The contractor shall have the opportunity to respond to any matter of issue during the audit or before the procurement officer's final determination. If, after reviewing the audit and the contractor's response, if any, the contracting officer determines that any of the criteria in subsection (b) have been met, the contracting officer shall make a final determination of inadequate performance. The procurement officer shall notify the administrator of the state procurement office of the final determination, and the administrator of the state procurement office shall enter the contractor and any other relevant information in the inadequate performance database.

(f) The administrator of the state procurement office shall establish by rule pursuant to chapter 91:

(1) Criteria for the removal of a contractor from the inadequate performance database, including the length of time that a contractor may be listed in the database; and

(2) Procedures to appeal any final determination by a contracting officer to list a contractor in the inadequate performance database.

(g) Before the award of any contract under chapter 103 or a construction contract under this chapter, the procuring officer shall consult the inadequate performance database. If a potential awardee appears in the database, the procuring officer may decide to either accept or reject the potential awardee based on the procurement officer's evaluation of the facts contained in the database and any additional information the procurement officer may gather, including an interview with the potential awardee. Any determination to award the contract to the potential awardee or reject the potential awardee's bid shall be made in writing and shall include the reasons for making the determination. A copy of the written determination shall be sent to the administrator of the state procurement office and the accepted or rejected awardee."

SECTION 3. Section 103D-206, Hawaii Revised Statutes, is amended to read as follows:

"§103D-206 Additional duties of the administrator of the procurement office. In addition to the duties referred to in section 103D-205, the administrator shall:

(1) Perform periodic review of the procurement practices of all governmental bodies;

(2) Assist, advise, and guide governmental bodies in matters relating to procurement;

(3) Determine corrective actions; provided that if a procurement officer under the jurisdiction of the administrator of the state procurement office or a chief procurement officer of any of the other state entities under section 103D-203, fails to comply with any determination rendered by the administrator within thirty days from the date of the issuance of the determination, or longer if permitted by the administrator upon request by the procurement officer or a chief procurement officer, the procurement officer or chief procurement officer shall be subject to an administrative fine under section 103D-106, for every day of noncompliance;

(4) Develop and administer a statewide procurement orientation and training program;

(5) Develop, distribute, and maintain a procurement manual for all state procurement officials; [~~and~~]

(6) Develop, distribute, and maintain a procurement guide for vendors wishing to do business with the State and its counties[.]; and

(7) Develop and administer an inadequate performance database pursuant to section 103D- ."

SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 5. This Act shall take effect on July 1, 2015.

INTRODUCED BY:	_____________________________

HOUSE OF REPRESENTATIVES	H.B. NO.	1180
TWENTY-EIGHTH LEGISLATURE, 2015
STATE OF HAWAII